Prime Minister Malcolm Turnbull unveiled the shake-up of funding for mental health services, which abandons its current one-size-fits-all approach.
An overhaul of Australia's mental health services has been a long time coming for those forced to deal with the system.
But the federal government has now announced a new strategy which aims to deliver services more effectively.
Health Minister Sussan Ley says the changes include a more tailored approach that matches services to people's level of need.
"What we are moving to is service delivery that matches what you receive as a consumer with what you need according to that level of need. At the moment it tends to be one-size-fits-all."
People identified by healthcare professionals as having complex needs will be able to access a range of services to manage their illness.
More funding will go towards Indigneous mental health, although the changes will not see extra funding overall.
"Over time, we may add more dollars, of course we would love to, but remember the mental health commission said to us it's not just about adding more money, it's about the fragmented nature of the system in the first place and that's what this is going to fix."
More than 30 government-funded phone and online services will be consolidated into a single telephone hotline for those seeking help.
And there'll be a new digital gateway for online mental health services.
OECD research shows the cost of mental illness to a country's Gross Domestic Product is four per cent.
With the government spending about $10 billion annually on mental health services, Prime Minister Malcolm Turnbull says funding needs to used more effectively.
"The impact of depression and other mental illnesses on our productivity - I think all of us know this is not from personal experience from friends and family - the impact is enormous. Our economic output is a function of participation, population and productivity. Mental illness gnaws away at the participation. It gnaws away at productivity."
The government's response comes more than a year after it received a scathing review from the National Mental Health Commission.
It includes criticism of the current system which only allows mental health patients 10 subsidised psychology sessions a year.
National Mental Health Commissioner Allan Fels says this announcement is a major step forward in enabling people to lead more contributing lives, and for Australia to grow thriving communities.
"I believe that the economic gains from mental health reform actually dwarf the gains that would be achieved from many of the other economic reforms being talked about at present."
Mental Health Australia CEO Frank Quinlan says the new measures will provide a strong platform for future reforms.
"Mental health reform has been a long-standing problem in Australia and we're pleased at last that we have a really focused structural approach to addressing these issues. The fundamental challenges of mental health reform are to get services more closely integrated and to get services more closely focused on the individual needs of consumers and carers."
But Opposition Mental Health spokeswoman Katy Gallagher is concerned the plan isn't detailed enough, and sets no specific target for reducing Australia's suicide rate, with 2500 people taking their lives each year.
"A big area, though, is around suicide, and seriously tackling what is a growing crisis across this country. 65,000 people attempt suicide every year in Australia. 2,500 lose their lives to suicide. The Mental Health Commission called for a 50 per cent target to reduce that number over the next 10 years, and that hasn't been part of the Government's response, they've just failed to respond to that."
It's not the first time a government has tried to address failings in the mental health system.
Almost a decade ago, former Prime Minister John Howard embarked on a national reform plan and the previous Labor Government announced a strategy back in 2011.
Mental health experts say the key this time around will be ensuring that plans are put into action.
The changes are expected to be implemented over three years, starting early next year.
